MBS Day Ahead: All Rise! The Judge is In

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Posted To: MBS Commentary

My apologies to baseball fans, both of you. The "judge" in today's case is this morning's CPI (Consumer Price Index) data. Bonds have been deliberating all month about whether to make an attempt to break above 2.40% or bounce back into the confines of the range that's dominated the past 6 months. On the plus side, yields quickly backed down from their first run at 2.40%, but on a negative note, they've thus far refused to move back below the 200-day moving average (or "the low 2.3's," if you prefer). This morning's CPI data isn't necessarily the be all, end all determinant of bonds' next move, but for several months, it's arguably been the biggest motivator in terms of economic data. Reason being: it's the last piece of the puzzle…(read more)

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